Gaming leads content surge
Thai firms still relying on imported material
The value of digital content in Thailand in 2016 was almost 22 billion baht and is expected to grow by 9% to reach 24 billion this year, says a study by the Digital Economy Promotion Agency (Depa).
The digital content industry consists of three sub-industries: gaming, animation and character design. In 2016, gaming grew by 14.8% and contributed 16.32 billion baht to digital content value, while animation, despite a slight decline of 1.6%, contributed 3.9 billion baht and character design made up the remaining 1.7 billion baht.
The study's findings reveal that both animation and gaming markets are gaining popularity in Thailand, due to blockbuster animations and games imported and created by Thai developers in 2016.
Character-related sales are also on the rise despite a lack of new hit characters. The most widely popular characters are ones created years ago.
Depa president Nuttapon Nimmanphatcharin said the positive factors surrounding the industry, including continuous increase of supply and demand, should raise digital content value to 24 billion and 26 billion baht in 2017 and 2018, respectively.
Animation is likely to recover in 2017, with 1.8% growth, before achieving a double-digit expansion of 10% in 2018. Growth in character design is anticipated at 9.6% in 2017 and 8.1% in 2018. The highest growth is to be seen in the gaming sector, with 12% forecast for both 2017 and 2018.
The digital content industry in Thailand is still primarily driven by imported content rather than locally developed.
"Imported animations contributed half to the total animation market in 2016, while imported characters accounted for 93% of the character design market, which is similar to the situation in the gaming market, where imports made up 96%," Mr Nuttapon said.
Exports of locally created digital content totalled 1.2 billion baht in 2016, up 6.2%. China, Japan, the EU and the US have increasingly outsourced production to Thai animators, propelling animation export value to 787.1 million baht, up 7.6% from 2015.
Character exports rose from 12.1 million baht in 2015 to 13.7 million in 2016, gaming exports expanded from 419.7 million baht in 2015 to 434.4 million in 2016.
Mr Nuttapon said while Thai animators, character designers and game developers are now globally recognised for their skills and competency, they still rely on foreign markets in terms of imports and revenue from outsourcing.
Moving up the value chain by creating Thailand's own intellectual properties will mitigate issues caused by low outsourcing fees and ensure that money spent on digital content is circulated in the country, he said.
Depa's roadmap includes establishing an internalisation fund to provide financial support to market players looking to expand overseas, a digital startup programme to foster new market players, and a co-creation space to foster cooperation and exchange of ideas among market players.
"By working together, we can realise our mutual goal of making Thailand a force to be reckoned with in the global digital content industry," Mr Nuttapon said.